FLEXIBLE SPENDING ACCOUNT

A Flexible Spending Account (FSA) is a tax-favored account that allows employees to have a set amount deducted from payroll on a pre-tax basis, saving both the employer and employee FICA taxes of 7.65% of the contributions. The employer may have a reduced unemployment tax liability. The employee reduces his or her federal income tax liability and in most cases state income tax liability.

HEALTH FSA

With a Health FSA, funds can be used to pay for eligible medical expenses not covered under other insurance. Eligible expenses include:

• Doctor’s office and prescription drug co-pays

• Medical deductibles and co-insurance

• Approved over-the-counter items

• Vision and dental costs

• Chiropractic services

DEPENDENT CARE FSA

• Daycare

• Nursery school

• Before and after school care

• Summer day camp

• Care for mentally or physically handicapped over age 13